Coal Gasification Push Marks a Defining Moment for India's Energy Self-Reliance

The scale of the impact expected from this scheme is immense. The government anticipates that it will catalyze investments ranging from Rs. 2.5 lakh crore to Rs. 3 lakh crore across roughly 25 major projects. Beyond the financial influx, the move is set to create nearly 50,000 jobs across the country.

To drive participation, the scheme offers several high-value incentives:

• Competitive bidding for incentives of up to 20% of plant and machinery costs.
• Extension of coal linkage tenure to up to 30 years for syngas production.
• A technology-agnostic approach that specifically encourages the use of indigenous technologies.

The industry response has been immediate. The first application round, which closed on September 7, saw seven major proposals from heavyweights including Adani Enterprises, NTPC, Talcher Fertilisers, Gallantt Ispat, and Shyam Sel & Power. These proposals cover a diverse range of outputs, including urea, synthetic natural gas, syngas, and DRI. The Ministry of Coal has already opened the second round of applications as of September 8.

Reducing Import Dependency

Dr Roger Kumar emphasized the economic necessity of this transition. He noted that during the 2024-25 period, India spent approximately Rs. 2.77 lakh crore importing essential commodities like LNG, urea, ammonia, and methanol.

“Converting our own coal into these products is a matter of economic security,” said Dr Kumar. “The structure of this scheme gives industry exactly the policy certainty it needs: long-tenure linkages, rolling application rounds and support for indigenous technology. The response in the very first round shows that confidence is building.”

Solving the High-Ash Coal Challenge

One of the primary hurdles for Indian gasification has been the nature of domestic coal, which typically contains between 25% and 45% ash. However, a NITI Aayog workshop in September 2025 identified that past failures were due to a mismatch between technology and feedstock, rather than the coal itself.

Dr Kumar highlighted that India's gasification journey must be engineered specifically around the high-ash coal available domestically. This shift allows the nation's domestic engineering base to become a vital national asset.

The Two Tracks of Gasification

The movement toward energy security is operating on two distinct but complementary tracks:

1. Coal-to-Chemicals

This track focuses on using oxygen-blown gasifiers to produce controlled syngas. The end products—urea, methanol, ammonia, and synthetic natural gas—are vital for the nation's industrial and agricultural needs. While capital-intensive, this is viewed as essential, long-term nation-building work.

2. Coal-to-Thermal Gasification

This track involves using air and steam to convert coal into producer gas, which is then used directly for industrial heat. This is applicable across various sectors, including steel, paper, textiles, ceramics, and food processing. Dr Kumar noted that thermal gasification can deliver immediate results, building on decades of experience where Indian plants have already gasified around 100 million tonnes of coal for process heat.

Proven Success on the Ground

The viability of these technologies is already being demonstrated in industrial settings. Dr Kumar cited a CASE Group installation at Rungta Mines Limited’s Kamanda steel plant in Odisha. In this facility, nine CASE gasifiers provide heat for iron ore pellet production.

The results from the Kamanda plant include:

• Replacement of up to 60% of furnace oil in the straight-grate pelletising process.
• Achieving 100% furnace oil replacement in a 1.0 MTPA grate kiln.
• The ability to operate effectively on high-ash coal with over 40% ash content.